The Financial Times reports that the now-deceased President of InTrade may have received some suspicious payments. It is quite speculative, but it seems this problem may go deeper.

The founder of Intrade received $2.6m in insufficiently documented payments from the popular prediction markets company in 2010 and 2011, an audit revealed weeks before trading on the site was halted.

Auditors for the Dublin-based company – an online hub where people can bet on everything from presidential elections to papal conclaves – highlighted concerns about “significant financial irregularities” and the payments made to John Delaney, according to financial records Intrade recently filed with Ireland’s companies registration office. Mr Delaney, who launched Intrade’s parent company in 1999, died on Mount Everest in May 2011.

The FT also reports that since the CFTC’s suit against InTrade, volume is way down.

The number of visitors to the Intrade site has plummeted in the wake of the CFTC lawsuit, leading even boosters to question the predictive value of its markets. Bettors on Intrade entered contracts that paid $10 for correctly guessing the outcome of events from elections to the Academy Awards. Academics and journalists toasted the site as a novel way to divine the wisdom of crowds.

After the suit was filed in November 2012, Intrade had said it hoped to reopen inside the US. The CFTC case is pending in a federal court in Washington.

Last year the CFTC prohibited the Chicago-based North American Derivatives Exchange from introducing what would have been the first regulated US political event contracts, saying they “ involve gaming and are contrary to the public interest”.

As of early Sunday, wagers on the identity of the successor to recently resigned Pope Benedict XVI were among Intrade’s most popular markets. A total of 52,166 unique trades had occurred since January 1, compared with 1m in all of 2012, data published on the site showed.

At MarketPlace, academics lament the loss of this important prediction market.

“I think it’s a big loss,” says Dartmouth economics professor Eric Zitzewitz. “Intrade was the most used prediction market for wagers, on topics of academic interest.”

You could bet on the elections, the war in Iraq, and the future of the euro. And all that market data was available on Intrade to discuss and dissect.

Justin Wolfers at the University of Michigan says Intrade was also important for pundits. It helped keep them honest. “Previously you could just wear your leather elbow patches, smoke a pipe and appear on PBS or CBS or any TV show saying any old thing,” says Wolfers. But, he says, just because Intrade is gone doesn’t mean we’re back to a world of fact-free jabber.

Intrade was the leading face of an important idea: “that broad crowds have a lot of information and that markets are an effective way of aggregating that information,” says Wolfers, “and they often turn out to be much better than experts.”